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UK gilts slide on expectations of upbeat February consumer price inflation; investors await BoE member Haldane’s speech

The UK gilts slid Monday, following expectations of a rebound in the country’s consumer price inflation (CPI) for the month of February. Also, investors are awaiting the Bank of England’s (BoE) Monetary Policy Committee (MPC) member Andy Haldane’s speech, scheduled for later in the day.

The yield on the benchmark 10-year gilts, which moves inversely to its price, rose 1-1/2 basis points to 1.25 percent, the super-long 30-year bond yields jumped nearly 2 basis points to 1.84 percent and the yield on the short-term 2-year traded over 2 basis points higher at 0.11 percent by 09:40 GMT.

The CPI rate for February is expected to have risen by at least 0.2 percentage point to reach the BoE’s target of 2.0 percent y/y for the first time since December 2013. But although CPI will remain the MPC’s target measure, the ONS will switch its headline measure of inflation to CPIH, a new index which in January has already reached 2.0 percent y/y, but is essentially CPI with just owner occupiers’ housing costs added.

Further, the central bank said that the country’s consumer price inflation is expected to rise to around 2 percent over the next few months. Moreover, it is also expected to exceed the central bank’s target materially by summer.

Meanwhile, the FTSE 100 fell 0.20 percent to 7,409.35 by 09:50 GMT, while at 09:00GMT, the FxWirePro's Hourly Pound Strength Index remained highly bullish at 106.16(a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex

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September 21 00:00 UTC Released

JPBOJ Rate Decision*

Actual

-0.1 %

Forecast

-0.1 %

Previous

-0.1 %

September 20 18:00 UTC Released

USFed Funds Target Rate

Actual

1.00-1.25 %

Forecast

1.125 %

Previous

1.125 %

September 21 07:00 UTC 44m

TRConsumer Confidence*

Actual

Forecast

Previous

71.1 %

September 21 08:30 UTC 9494m

GBPSNB, MM GBP

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Forecast

Previous

-0.76 Bln GBP

September 21 08:30 UTC 9494m

GBPSNCR, MM GBP

Actual

Forecast

Previous

-3.912 Bln GBP

September 21 08:30 UTC 9494m

GBPSNB Ex Banks GBP

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Forecast

7.100 Bln GBP

Previous

-0.184 Bln GBP

September 21 12:00 UTC 304304m

BRIPCA-15 Mid-Month CPI

Actual

Forecast

0.15 %

Previous

0.35 %

September 21 12:00 UTC 304304m

BRIPCA-15 Mid-Month CPI YY*

Actual

Forecast

2.60 %

Previous

2.68 %

September 21 12:30 UTC 334334m

CAWholesale Trade MM

Actual

Forecast

-0.9 %

Previous

-0.5 %

September 21 12:30 UTC 334334m

USInitial Jobless Claims

Actual

Forecast

300 k

Previous

284 k

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